Abu Dhabi Commercial Bank set to acquire stake in Malaysia's RHB

UAE. Abu Dhabi Commercial Bank (ADCB) has received ministerial approval to buy a 25% stake in RHB Capital.

The price has been estimated by Malaysian local media at between RM7.20 (US$1,90) to RM7.40 per share. There is however no confirmation, from either party, of the final valuation.

In February, ADCB said it would pay about US$1.2 billion for the stake.

RHB Capital shares closed Monday at RM4.90 down 1.21%.

The Employees Provident Fund (EPF), which owns 82.23% of RHB Cap, has expressed confidence the move would help RHB Cap grow into a strong regional financial services group.

ADCB has been in exclusive talks with EPF since December to buy a stake to enter the Southeast Asian market for financial services complying with Islamic law.

"We should close the deal within the next 30 days," Eirvin Knox, ADCB's chief executive officer, told reporters in Abu Dhabi on Monday. "The bank has a good footprint and a strong brand name ... Southeast Asia is a high-growth market."

In a statement later, the bank said the Malaysian Ministry of Finance had approved the purchase.

Euromoney has named ADCB as the “Most improved Islamic bank in the Middle East” and RHB Cap as the “Most improved Islamic bank in Asia.”

ADCB was also voted as the best bank in the United Arab Emirates this year by the same publication. The awards were presented at the 2007 Euromoney Awards for Excellence Middle East event in Abu Dhabi in June last year.

ADCB is 64.8% owned by the Abu Dhabi Government through the Abu Dhabi Investment Council.